Updated Oct. 24 at 4:20 p.m. with reaction
Another major St. Louis-based company is being sold. Scottrade has announced a $4 billion deal to be acquired by TD Ameritrade. The financial services company has been based in St. Louis since 1981.
The deal means the Scottrade name is going away. The company will operate under the TD Ameritrade banner once the acquisition closes next year, pending regulatory approval.
TD Ameritrade officials said they plan to operate a "sizable call center" while keeping a mix of client and support positions in St. Louis. The company will keep the naming rights to Scottrade Center, but the arena will be re-branded TD Ameritrade Center.
In a note to clients, posted on Scottrade’s website, Chief Executive Officer Roger Riney said it will be business as usual for the time being.
“It will take 9-12 months for the transactions to close and until then, we will be operating as separate and independent companies.”
The deal is expected to close by the end of September 2017.
There are two major steps in the acquisition. First, TD Bank will buy Scottrade Bank. Once that closes, TD Ameritrade will complete the deal for Scottrade Financial. Regulators still have to sign off on the acquisition.
TD Ameritrade said it is "fair to assume job losses" in the transaction, but it will remain a major employer in the St. Louis region. It plans to be involved in the community through volunteerism and employer matching programs. Like Scottrade, TD Ameritrade takes part in the United Way’s Day of Caring.
St. Louis will lose hundreds of jobs in the deal. Scottrade has roughly 1,800 workers in the region. TD Ameritrade officials said they plan to have 500 to 1,000 employees in the area once the acquisition is complete. Any worker who loses a job in St. Louis will have the chance to move elsewhere within the company, which has about 300 open positions at any given time.
In an email to St. Louis Public Radio, the company added that any employees who do not stay with TD Ameritrade will be "treated very fairly and generously."
Jay De Long is a general partner with the fin tech accelerator and investor SixThirty. He said many of those who lose their jobs likely will be absorbed by other financial service firms in St. Louis. Still, he doesn't think St. Louis should be complacent.
"I don’t feel like we can sit back and say we dodged that bullet," De Long said. "I think we’re going to constantly have to work together and look forward five and 10 years and look at trends in the industry and how do we stay ahead of it and be proactive, not just responsive."
De Long said some Scottrade employees will likely have their own ideas for startups. He said the region should be prepared to help them.
The announcement comes weeks after German company Bayer confirmed plans to acquire St. Louis-based Monsanto. That is a $66 billion deal, which also needs regulatory approval.
Bayer said it plans to maintain a major presence in St. Louis, by making it the headquarters for the seeds and North American commercial operations.
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